E&Y may advise Bharti, PwC for MTN: report
26 Jun 2009
Bharti Airtel may ask Ernst & Young to do a due diligence on South African telecom major MTN, the company with which it is in talks for a complex mutual acquisition of equity to form one of the top telecom conglomerates of the world, according to a report.
Quoting unnamed executives, The Economic Times reported that MTN is likely to appoint PricewaterhouseCoopers (PwC) to do a due diligence on Bharti Airtel's books. Both E&Y and PwC will get access to virtual data rooms.
Bharti will begin due diligence for MTN on 29 June, sources told CNBC-TV18. The structure of the Bharti-MTN deal has almost been finalised. There is no significant change from what has been discussed so far.
Bharti and MTN are slated to continue their exclusive merger talks till the end of July, after which it will still take up to four months for regulatory and other approvals if the deal comes through, Citigroup said.
Bharti and MTN last month revived talks to create a major emerging market telecoms group, a year after previous talks broke down over who would control a merged entity.
"If the deal goes through, it would require two-four months for various external approvals, including regulatory approvals," Citigroup said in a report, citing a presentation made by Bharti in an investor conference hosted by the brokerage.
Under the proposal unveiled in May, Bharti would be left with 49 per cent of MTN, while the South African firm and its shareholders would get 36 per cent of Bharti. That could lead to a full merger of the companies.
Citigroup also said Bharti expected bids for the upcoming third-generation spectrum to be "rational" and saw a "marginal" increase in capital expenditure as 3G spending would be partly replacing expenditure on 2G networks.
Bharti has proposed capital expenditure of about $2 billion for the fiscal year to March 2010. This does not include possible investment on 3G networks and in its tower business.
Both Bharti and MTN refused to comment officially on the talks.
Quoting unnamed executives, The Economic Times reported that MTN is likely to appoint PricewaterhouseCoopers (PwC) to do a due diligence on Bharti Airtel's books. Both E&Y and PwC will get access to virtual data rooms.
Bharti will begin due diligence for MTN on 29 June, sources told CNBC-TV18. The structure of the Bharti-MTN deal has almost been finalised. There is no significant change from what has been discussed so far.
Bharti and MTN are slated to continue their exclusive merger talks till the end of July, after which it will still take up to four months for regulatory and other approvals if the deal comes through, Citigroup said.
Bharti and MTN last month revived talks to create a major emerging market telecoms group, a year after previous talks broke down over who would control a merged entity.
"If the deal goes through, it would require two-four months for various external approvals, including regulatory approvals," Citigroup said in a report, citing a presentation made by Bharti in an investor conference hosted by the brokerage.
Under the proposal unveiled in May, Bharti would be left with 49 per cent of MTN, while the South African firm and its shareholders would get 36 per cent of Bharti. That could lead to a full merger of the companies.
Citigroup also said Bharti expected bids for the upcoming third-generation spectrum to be "rational" and saw a "marginal" increase in capital expenditure as 3G spending would be partly replacing expenditure on 2G networks.
Bharti has proposed capital expenditure of about $2 billion for the fiscal year to March 2010. This does not include possible investment on 3G networks and in its tower business.
Both Bharti and MTN refused to comment officially on the talks.